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No inflation stickiness: Suppose the classical dichotomy holds in the short run as well as in the long run. That is, suppose inflation is not sticky but rather adjusts immediately to changes in the money supply.
(a) What effect would changes in the nominal interest rate (or the money supply) have on the economy?
(b) What effect would an aggregate demand shock have on the economy?
(c) What about an inflation shock?
We are all familiar with fluctuating prices of gasoline at the pump. Explain why does this happen.
Consider a labor market with a monopolistic firm that has a labor demand curve of MRPL=16-.5L, where L is thousands of hours of work. Suppose that workers at the firm are organized into a union that has a union objective function of U=WL, where W is ..
The following equations are the market demand and supply schedules before the imposition of a per unit tax. (Qd = quantity demanded, Qs = quantity supplied, P = price) Assume there is an imposition of a $2 per unit tax on producers. Graph the supply ..
Firm S produces steel with a cost function cS(s,x) = s^2 + 10 − (12x − x^2), where s is units of steel and x is units of a pollutant that is a byproduct of steel production. Another firm F produces fish with a cost function cF(f,x)=3f^2+fx,where f is..
What is the amount A in actual dollars equivalent to A’ = $1,000 in constant dollars? Please provide step by step detail
How to design an experiment to test the theory that changing the oil of the new backhoes and forklifts will reduce repairs.
How does this policy affect the total quantity of investment? The quantity of business investment? The quantity of residential investment?
What ways do correction professionals use the social justice principles of equality, solidarity, and human rights to build a more just society?
A firm faces a demand where q = 256/p^2 . q is quantity demanded, P is price. Its P2 total cost function is TC = 0.5q^2 + 10 . What is its total revenue function in q? What is its profit function? What is its marginal revenue function? What is its ma..
Which of the following best defines basic research?
In looking at market structures we often see that monopolies are sole providers of a good or service. In looking at utility companies, why are they typically awarded the ability to be monopoly from government?
Write down a paper analyzing different approaches that might be used by Keynesian theorists and monetary theorists to promote long-run macroeconomic stability.
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